Glossary · The loan itself
In short
This is a business whose primary activity is owning and renting real estate, with little to no active management or services provided. SBA loans generally do not fund these types of businesses.
The SBA generally restricts 7(a) loans for passive real estate businesses because they are not considered "operating businesses." Your loan application will be denied if the business's main function is collecting rent. Ensure the business you're buying provides substantial services beyond just property ownership.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Defined by DealRoom.so SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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